Swiss Watches Inc approaches Taiwan Watches Inc. with an inquiry about a special order. Taiwan Watches has excess capacity. The following information per unit data is given for sales to Taiwan's regular customers: Variable costs: Direct materials Direct labour $200 55 50 Marketing costs Variable overhead 105 Fixed costs: Manufacturing support Marketing costs Total costs 100 80 Markup (50%) Targeted selling price 590 295 $885 For Taiwan Inc., what is the minimum acceptable price of this special order? Taiwan Inc. will incur no variable marketing costs for this special order. O $350 O $430 O $360 O $300
Swiss Watches Inc approaches Taiwan Watches Inc. with an inquiry about a special order. Taiwan Watches has excess capacity. The following information per unit data is given for sales to Taiwan's regular customers: Variable costs: Direct materials Direct labour $200 55 50 Marketing costs Variable overhead 105 Fixed costs: Manufacturing support Marketing costs Total costs 100 80 Markup (50%) Targeted selling price 590 295 $885 For Taiwan Inc., what is the minimum acceptable price of this special order? Taiwan Inc. will incur no variable marketing costs for this special order. O $350 O $430 O $360 O $300
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:QUESTION 5
Swiss Watches Inc approaches Taiwan Watches Inc. with an inquiry about a special order. Taiwan Watches has excess capacity. The following information per unit data is given for sales to Taiwan's
regular customers:
Variable costs:
Direct materials
Direct labour
$200
55
Marketing costs
Variable overhead
50
105
Fixed costs:
Manufacturing support
Marketing costs
Total costs
Markup (50%)
Targeted selling price
100
80
590
295
$885
For Taiwan Inc., what is the minimum acceptable price of this special order? Taiwan Inc. will incur no variable marketing costs for this special order.
O $350
$430
$360
$300
QUESTION 6
Hojnik Inc produces part ABC used in several of its engine models. Monthly production costs for 1,000 units are as follows:
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